On steamboats;

ST always claims that the steamboat in Korea is the best — it has meat and fish etc. etc. C says sharing in a Korean steamboat is ‘an art’, you need a specialized way of cooking and for a specified estimated number of minutes.

I disagree, I love the Asian version of steamboat – a charcoal fire steamboat is the best, fish head steamboat!! Fresh fish and vegetables and soup which has been stewed for more than 8 hours. The taste is absolutely local-heavenly and I could have it for hours.

So today my parents had such a steamboat and it really made my day to see it again. I think if I was better in science I’ll invent something to make cooking by charcoal convenient because I would love a charcoal iron so much. Imagine, my husband coming home to see me covered in charcoal!

Today I got upset for quite awhile to learn that my mother had secretly sunk a significant part of investments – the whole university fund worthy amount, into a structured investment professing to be ‘akin to a fixed deposit’. I haven’t read the papers, but already suspect that it is a zero coupon messed up with derivatives, and not as capital guaranteed as it holds itself out to be.

Its not the first time, because my mother is constantly sinking tens of thousands into unsecure bond structures, and is susceptible to any salesperson, be it insurance, beauty care or anything else. I spent some hours talking to her about structures in an analogical simplified way, to demonstrate to her why her dividends weren’t really ‘dividends’ in the equity sense, and why, fundamentally, what she bought was really a zero coupon bond. She denies it on the worth of the said intermediary. But even the worth of a bank, itself acting as an intermediary, is very different, and she fails to see the difference between the investment elements of the structured investment and a fixed deposit.

It is the same for certain friends who constantly profess the worth of certain reits still, and how the equity market is set to turn, and the contra trading ads all around the train station. I feel as though in Singapore, the element of gambling seems to be a better word for what some said ’speculators’ are doing.

Take a contra investment, where you hope to turn over cash by t+3. Most people who engage in contra then rely on turning over trades quickly, and to catch the fundamental first part of the wave, which is more luck than anything else, and does not even turn to even any profession of efficiencies or best price – it is a volume based transaction, basically, trading to trend, to catch the fervour of the market.

Which is all well and good if you caught the first leg, but after that it is bound to turn sour, and be like a game of poker where the fundamental rules are irrelevant, and probabilities discarded. The types of shares do not matter. The crucial element is time, and yet the markets are so volatile and unlikely that you are riding on chances…  chances that people will follow, chances that there will be sudden bumps for no rhyme or reason. In short, you are trading those accidental irrelevant snaggles which occur in the daily tale of the markets.

I find even the idea of playing contra trade as a constant endeavour akin to the ‘will the restaurant be empty’ game we play every once in a while.

Take away the charm, and focus on the psychology of the markets, but not don’t ride on the technical blips and inefficiencies. And don’t expect to get lucky from technical blips, unless you are a seasoned arb trader. And arb traders are quickly washed out, only the most brilliant are left, in the end.

What do you think?…